Glen where? EU court questions German's whisky branding

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FILE PHOTO - Single malt whisky is seen in Edinburgh, Scotland May 2, 2014. REUTERS/Suzanne Plunkett

LUXEMBOURG (Reuters) - A German distiller selling a whisky called “Glen Buchenbach” may be infringing Scotland’s rights on its national drink even though he makes clear he produces it in Germany, the EU’s top court ruled on Thursday.

The European Court of Justice took no final view, referring a complaint from the Scotch Whisky Association back to German judges to make a ruling. But in answering the Hamburg court’s query, it offered guidance to assess whether Michael Klotz’s canny branding overstepped EU law on protected regional labels.

“Scotch Whisky” can only be sold in the European Union if it is actually made in Scotland, for which the spirit is the biggest international export earner. Klotz’s “Swabian Single Malt Whisky”, distilled near Stuttgart, is labeled as made in Germany. But the Scots argued that the use of the Gaelic term “glen” — a valley — could mislead buyers to think it Scotch.

The ECJ said the German court must decide whether the “average European consumer” would indeed make that error.

It stressed that it was not enough for the word “glen” to evoke some kind of association with Scotland. It must actually bring to mind Scotch whisky. But it did not matter, the court added, that the label said the product was made in Germany.

As with many of Europe’s hundreds of protected geographical designations, such as France’s Champagne sparkling wine or Parmesan cheese from Italy, Scottish distillers are fiercely vigilant of their branding — whisky accounts for 20 percent of British food and drink exports and some 40,000 jobs.

However, Britain’s imminent departure from the EU next year has raised some questions about those protections. In principle, London and Brussels say they hope to continue recognizing each other’s labeling rules but negotiations are still going on.